(USA Today)-- Do you fight about money with your spouse or significant other?
Do you have trouble following a budget – assuming you even have one? Are you a compulsive spender?
If so, you might need financial therapy.
What is financial therapy?
Think of it like psychotherapy.
But instead of improving your state of mind it seeks to improve the state of your money. In essence, it’s supposed to help you behave differently, and for the better, with your money.
Megan McCoy, an instructor at Kansas State University’s Financial Therapy Certificate Program, says financial therapy falls on a spectrum with mental health treatment at one end and financial planning at the other.
According to McCoy, financial therapy can be as intense as mental health treatment – where unresolved financial trauma is resolved -- but it can also be talking with a financial professional who helps you explore your financial goals in a new light.
Do you need coaching, not therapy?
At least one expert says it’s important to note the difference between financial coaching, the sort of thing a financial adviser might do for normal money-related issues, and financial therapy.
Financial planners, for instance, will coach clients toward positive financial outcomes, says Victor Ricciardi, a finance professor at Goucher College.
For instance, many do-it-yourself investors, according to Dalbar study, often buy and sell mutual funds at the wrong times; they buy when prices are high and sell when prices are low. And that’s the exact opposite of what they should be doing.
That behavior, which is all too common among average investors, doesn’t, however, merit financial therapy.
Rather it merely requires coaching on the part of a financial planner.
Financial therapy, by contrast, focuses on deeper psychological experience issues that result in money disorders, says Ricciardi.
“Clients are influenced by money flashpoints and beliefs they develop during their childhood and teenage years,” he says. “If these experiences are positive ... an individual is more likely to have a positive view of money in their adulthood.”
But if these money experiences are negative -- observing our parents overspending and accumulating credit card debt -- an individual is more likely to have a negative view of money in their adulthood, says Ricciardi.
“Many times, these individuals will repeat this negative behavior,” he says.
“In the most severe cases, for some individuals, this results in money disorders such as compulsive gambling, hoarding, and obsessive shopping.”
Is financial therapy best for you?
Do you and your significant other have communication problems? That’s the biggest sign that financial therapy is necessary, says Derek Lawson, a visiting instructor in Texas Tech University’s Personal Financial Planning Program and a financial planner with Priority Financial Partners in Durango, Colorado.
Does one person cross their arms when the other is talking?
Does one spouse interrupt or consistently answer for the other partner? Are one or both spouses sarcastic in an almost uncomfortable way towards the other, perhaps to be hurtful?
And, is one hiding something financial, such as a bank account, from their spouse? In all these cases, the couple likely needs to see a financial therapist -- and perhaps a couple's therapist, says Lawson.
Other signs you might need therapy?
Brad Klontz, an associate professor of practice at the Financial Psychology Institute at Creighton University, says the following are also signs you might need financial therapy:
When you are engaging in chronic self-destructive financial behaviors; when your financial stress is keeping you up at night; when financial problems are interfering with your relationships or your work; and when financial stress is having a negative impact on your health.
Where to find help
The Financial Therapy Association Network has an online tool that allows people to search for financial therapists, some of whom might have a Certified Financial Therapist-I or CFT-I designation.
Have no fear
Any stigma you may feel from using a financial therapist should be offset by the benefits of consulting one, experts say.“Since 2007, money has been consistently rated as the number one stressor for Americans,” McCoy says. “Everyone could use more skills to handle that stress, use their money more efficiently, and reach their financial goals.”
Signs you need therapy:
Fighting with your spouse over money, with one seen as a spender, the other as a saver
An inability to follow a budget.
Feeling emotional distress from estate planning.
Struggling to decide how (and how much) to financially support adult children
Hoarding; this can also mean a compulsion not to spend money
Anxiety about finances
Excessive risk aversion and/or excessive risk-taking around finances.
Emotional distress from foreclosure
Dealing with inheritances
Couples deciding to merge or keep finances separate after marriage.